The Incoterms Cost and Freight (CFR) and Cost, Insurance and Freight (CIF) mean that the seller is then responsible for loading the products and paying any fees associated with the port and shipping. Therefore, CFR and CIF are commonly used terms in purchase and sale agreements where the buyer has slightly more negotiating power than the seller.
Goods shipped under the condition Cost and Freight (CFR) must be loaded onto the method of transport by the seller. The seller is then responsible for paying any fees associated with the port of loading as well as paying the shipping cost to deliver the goods to the buyer. However, the cost of insurance (if necessary) and all fees associated with the port of call are borne by the buyer.
While a choice of language clause can help clarify which of the versions of the contract is the real one, it is important to have the translation as accurate as possible for a variety of reasons. When drafting a contract, each word carries special meaning and, if a sloppy translation is provided to one party, they may not have an accurate understanding of what the contract really says.
The exclusivity of an agreement is an important part of negotiating any business deal and plays a large role in licensing agreements and distributorship agreements. Making a distributorship agreement exclusive means that only the distributor with the exclusive right may sell the products. Similarly, an exclusive license means that only the licensee can use the license. This exclusivity provides a major business advantage, ensuring that the exclusive distributor or licensee will not face any competition from other companies distributing the same product or using the same license.